Although our blog primarily focuses on Chapter 7 and Chapter 13 bankruptcies, the Chapter 11 bankruptcy case of Robb & Stucky has been a popular topic of discussion in Florida during these past few weeks. The Fort Meyers-based furniture chain announced in February that the company was filing for Chapter 11 bankruptcy protection. After 96 years of business, the high-end furniture company commented that the downturn in the housing market and the recession has contributed to the company’s decision to file bankruptcy.
The company said in statement, “The home furnishing industry has been among the hardest hit by the significant decrease in consumer spending.” Robb & Stucky own 20 stores in Florida and have several other locations out of state in Texas, Arizona and Nevada. When the company filed Chapter 11 last month they were originally hoping to seek a buyer. However, the home furnishings company could not find a buyer and was ordered by a bankruptcy judge to begin the liquidation process of their assets. The liquidation process began last week and inventory estimated to be worth $90 million will be sold at a discount price. The stores will close after the sales are completed.
Robb & Stucky listed over $57 million in debt in the bankruptcy filing. In June, the company’s revenue was listed at $139.7 million. However, June’s revenue was drastically less than revenue for 2006 which totaled $273.7 million. The decline in sales has resulted in the company owing 760 employees $1.6 million in wages. The company also owes $118,913 in taxes.
Due to the inability to find a buyer and the order to liquidate assets, the Florida-based company notified employees last week that they plan to lay off 178 employees by April 23.
Bankruptcy is much more complex for large companies, but Robb & Stucky’s bankruptcy proves once again that the recession is still affecting individuals and businesses. Before letting debt spiral out of control, individuals can seek guidance from a bankruptcy attorney who will review the individual’s financial situation and offer some advice about the benefits of bankruptcy protection.
Sarasota Herald-Tribune: “Robb & Stucky now saying it will lay off 380,” 14 Mar. 2011
Sarasota Herald-Tribune: “Robb & Stucky files for bankruptcy,” 21 Feb. 2011